Did you know Google allows many nonprofit organizations to spend up to $10,000 per month in free AdWords advertising? That's right, Google takes care of the bill via its Google Grants program.

It's astonishing how many nonprofit organizations (or people in general) aren't aware this program exists. So let's look at what Google Grants is, and more importantly, some examples of how you can best take advantage of what's available.

What is Google Grants and Why Should You Apply?

Google created the Grants program in 2003 to allow 501(c)(3) organizations (e.g., charitable health care centers, schools, etc.) to advertise via the Google AdWords platform. Once accepted, these organizations have received up to $10,000 per month to spend on Search ads, and in some cases up to $40,000 per month for those who qualified for “Grantspro” (see bottom of this article for more information).

In terms of the process to get Google Grants up and running, you used to be able to apply directly in one step with a very simple form using your organization's Employee Identification Number (EIN). But in recent months Google started requiring that you apply for the Google for Nonprofits program first and then to the Google Grants product once accepted in the overall program, now making it two steps. That said, the approval time has shortened but can still take at least a month.

As you might have guessed there are some caveats and restrictions to the program as mentioned on the Program Details page. Also, on Friday, January 25, 2013 Google announced two major changes to Grants:

As of January 28, 2013, Google Grantees may bid up to $2 USD on keywords. This is an increase from the previous CPC bid cap of $1 USD and may allow your ads to enter auctions previously unavailable at the $1 bid cap.

To balance the interests of businesses who pay to advertise on Google search, your ads will now appear below the ads of traditional AdWords advertisers.

Only time will tell what these changes truly mean to your Grants campaigns and how that affects the positioning of your ads in SERPs, clicks, click-through rate (CTR), conversions, etc. – something I will be monitoring very closely in the coming weeks.

Here are all of the Google Grants program restrictions:

A daily budget must not exceed $330 USD, which is equivalent to about $10,000 per month.

There is a maximum cost-per-click (CPC) limit of $2 USD.

You can only run keyword-targeted campaigns.

Your ads can only appear on Google.com search (even though AdWords typically enables you to run display, video and/or mobile ads, in addition to Google.com search ads, if you're paying out of your own pocket).

You can only run text ads.

Your ads will run for as long as the organization remains actively engaged with their Grants AdWords account.

Examples of How You Can Take Advantage of the Program

Let's get to some use cases:

Focus on brand.

Really think about your goals.

Use it for pilots to build data and justify bigger spend.

In terms of generally setting up and running your ads, you'll want to use typical best practices (e.g., doing keyword research around your focus areas, having tightly-themed campaigns, ad groups and ads to your keywords, writing copy with clear call-to-actions). So if you don't have the background and experience with pay-per-click advertising, then you can easily find a reputable agency to help you get your ads going and manage them for you.

Focus on Brand

As mentioned above, AdWords ads that are run through the Google Grants program have a $2 max CPC. Because of this, it means:

As you figure out your target keywords, you'll have to see if the average CPC in your target area for your ads is over/under $2. Using historical data out of a previous AdWords account is best for this exercise, but if you don't have access to that information then you can use the AdWords Keyword Tool for your country to view approximate CPC.

If your average CPC for your keywords is under $2, that's great, and you'll likely have high average positions in the SERPs for your ads through Grants, as long as there aren’t many paying advertisers bidding on those terms already. If the average CPC is over $2, then your ads will likely appear lower in the SERPs, which may or may not be a bad thing – you'll have to do some testing to see which positions lead to higher conversions. The main thing is you just don't want the average CPC to be so high, and there to be that many advertisers, that it knocks you out of appearing at all from the SERPs with your $2 bid per keyword through Grants.

So you'll have to be strategic about which ads you run out of Grants. Organizations have the option to create two AdWords accounts (highly recommended):

One for ads run out of the Grants account where the average CPC hovers around $2 or less.

One for ads run out of a “paid” account, where you spend money out of your own pocket for average CPCs higher than $2.

Note: if you run Grants ads and paid ads, then Google requires that they must be out of two separate AdWords accounts.

If you take a look at your brand terms performance (i.e., keywords that include the name of your brand), you'll notice that often your average CPC is less than $2. So this is one major area where you can really take advantage of Google Grants – run at least your brand campaigns out of your Grants account and other campaigns out of your paid account as necessary. Assuming your AdWords budget stays the same over time, this allows you to pump more money into those other campaigns in your paid account throughout the month.

Really Think About Your Goals

Don't focus on one area for running your Google Grants campaigns – think about your organizational goals and get creative to use your account to drive any of the following:

Donations (as long as they're 501(c)(3)-related).

Downloads on your site.

Traffic to educational pages.

Jobs and volunteering opportunities.

Etc.

Use it for Pilots to Build Data and Justify a Bigger Spend

You might have a great idea to increase performance around one of your goals, but no budget identified to put any real money towards the program. Google Grants is a great way to test out different hypotheses and see what might work for your organization. Once you have the data, you can start to build a business case and take it to your supervisor to discuss budget opportunities.

Note: in the recent past Google offered a Grantspro program for eligible nonprofit advertisers to receive up to $40,000 in free advertising per month for those that hit their $10,000 per month cap three consecutive months in a row. As of this writing, Google has discontinued accepting new applications for Grantspro, and it's not clear whether they will open it back up. Let's hope they do for nonprofits that could really use the advertising dollars but don't have the budget.

Editor’s Note: This post has been updated from its original publication to reflect changes to the Grants program announced by Google on January 25, 2013.